In what is being hailed as a victory for Education and Employment Secretary Gillian Shephard over right-wing ministers, DFEE officials have made it clear that they are not proposing a cash-based voucher system similar to that being piloted in nurseries.

This commitment will be welcomed by heads of schools with sixth forms and principals of small colleges who would be most at risk from a system in which 16-year-olds were issued with vouchers with a cash value.

Instead, the DFEE is considering a learning credit scheme, outlined in the Government’s third competitiveness white paper two weeks ago, in which the student would be simply given a document spelling out the choices available.

The decision follows years of debate over vouchers - seen as a lynch-pin of right-wing Tory education policy - which has led to the current trials of nursery vouchers in four local authorities in London and Norfolk. Parents are given vouchers worth Pounds 1,100 which can be used to pay for a local authority-run or private nursery place.

Post-16 education was thought to be the next sector targeted for vouchers by right-wing ministers, although a report on a pilot scheme by Coopers and Lybrand in 1994 warned of overwhelming bureaucracy and huge costs.

A working party of officials from the DFEE and several education bodies including the local authority associations is considering how costs between the three main routes for 16-year-olds - sixth form, college and training schemes - can be equalised.

The latest statement on post-16 studies by the DFEE could signal further political battles. In a report on the latest (third) competitiveness White Paper, DFEE officials say “key partners” will be involved in drawing up proposals for a credit scheme to be phased in from 1997, with a consultation paper to be published this autumn. But the report adds: “Contrary to some press reports, we are not proposing a cash-based voucher system.”

Alan Parker, education secretary at the Labour-led Association of Metropolitan Authorities, said: “The sensible tendency in the DFEE appears to have been successful. The right sort of learning credit approach would provide the impetus to young people to take up educational and training opportunities. But thankfully we have been saved from the massively expensive and damaging bureaucracy that would be associated with cash vouchers.”

John Sutton, general secretary of the Secondary Heads Association, said: “We have never seen vouchers as a sensible way of organising funding because it would be an unnecessary bureaucracy . . . The situation is far more complex than extreme right-wing thinking would suggest.”

The Confederation of British Industry, which has long supported moves towards a voucher system, said it would also favour learning credits.

But education and training director Tony Webb warned: “It depends very much on what form they take”.